Shopkick Strengthens Its Signal for Macy's Mobile Rewards Rollout

Shopkick's mobile rewards system has relied so far on small devices retailers install at their doors to signal to an app that a customer has visited in person. But for a giant like Macy's, those little devices can add up to a big headache.

Macy's, which launched with shopkick in 2010, has become its first client to switch to a system that sends the signal through the speakers that already pipe in the store's music, shopkick announced July 18. The speakers, like shopkick’s transmitters, put out an inaudible tone that an app can sense through a smartphone's microphone. Macy's is using this new method to expand its use of shopkick nationwide.

"The transmitters are what we call nightlight-easy. You just plug them in and they work … having said that, it still takes coordination on behalf of the retailer to make that happen across a thousand stores," which is why a large retailer would want a simpler alternative, says Doug Galen, shopkick's chief revenue officer.

Shopkick's mobile system provides "kicks," a rewards currency, when consumers visit a merchant partner while the app is active on their phone. Shopkick also works with Visa and MasterCard to reward consumers when they make payments.

To send its signal over stores’ speakers, shopkick is working with Mood Media Corp., which provides music to over 800 retailers, including Macy's. The shopkick tone is added to the music that is played over the store's speakers — and if the tracks are managed remotely by Mood Media, no one in the stores has to set anything up to get the rewards system working.

The Mood Media deal is shopkick's latest move to improve the appeal of using its app. In April, shopkick updated its app to work without an immediate connection to the phone's network. This allowed its app to perform better in stores where the thick walls block phone signals.

The Mood Media arrangement also makes things easier for consumers, since users do not have to remember to have the app active while within range of a transmitter they cannot see or hear. Since the retailers typically play music throughout the store, a consumer would almost always be able to pick up the signal sent through Mood Media's system.

For retailers, there is a cost savings. Shopkick's transmitters cost less than $100 each, and the vendor recommends using multiple devices if the store’s entrances are more than a couple hundred feet apart. Sending the signal through retailers’ existing speakers saves not only on the hardware costs, but it also makes it easier to deploy at a large scale.

"In marketing, any time one touches store operations, it's an additional step to deploy a marketing strategy … [removing the need to install transmitters] is just removing an additional step to deploy a marketing strategy," Galen says.

Some retailers use different tones to set up "enjoyable detours," Galen says. These reward shoppers for visiting different parts of the store. These detours can also be offered through the Mood Media setup, since retailers already play different music tracks in different departments, he says.

"Typically the music systems in retailers are either looked at as a cost to the business or maybe neutral," Galen says. "And now they can actually use an existing infrastructure to help drive sales."